Delaware Gov. Wants $34M for Tech-based ED

As promised in her 2004 State of the State Address, Gov. Ruth Ann Minner released a New Economy Initiative last week that includes several new elements to encourage economic growth in Delaware. The $34 million package is expected to generate at least $16 million more in federal and private match. Many of the elements of the plan were recommended by the governor's Strategic Economic Council.

The largest component of Gov. Minner's proposal is a new $12.5 million Delaware Competitiveness Fund to make one-time investments in companies modernizing their production facilities. As presented in the governor's press materials, the uses for the fund could be quite broad: provided matching grants for implementing new manufacturing processes; bring in new product lines; abate taxes; find buyers for idled facilities; support employee training; and, bring R&D results into manufacturers' operations.

Other elements include:

• Creating a $1.5 million Technology-Based Small Business Seed Fund within the Delaware Economic Development Office to provide nascent tech firms with equity or competitive grants of up to $50,000 for start-up expenses such as lab equipment, working capital, lab and office space, patent filings, or prototyping;
• Injecting an additional $3 million into a Delaware-focused private sector venture fund for equity investment in emerging businesses. The new monies would attempt to leverage $6 million in Small Business Administration funds;
• Establishing a $1 million Virtual Emerging Technologies Incubator to provide statewide support for scientists, engineers and others with emerging technological entrepreneurial ideas to start and grow their businesses;
• Creating a fuel cell research center in partnership with the University of Delaware and private sector to position the state in the emerging hydrogen energy industry. Under the Governor's plan, the state would commit $200,000 annually for five years toward the Clean Energy Research Center; and,
• Offering up to $800,000 in Clean Energy Performance Grants to attract manufacturers of clean energy technology, such as photovoltaic cells, fuel cells and wind energy components.

A three-year $4.5 million commitment is included in the governor's proposal for Delaware's Experimental Program to Stimulate Competitive Research (EPSCoR). The National Science Foundation will match the state contribution on a two-to-one basis.

The remaining $10 million of the package would recapitalize the state's strategic fund, which is used by the Delaware Economic Development Authority for business recruitment, retention and expansion activities.

Funding for the New Economy Initiative would be included in Delaware's FY 2005 Capital Budget and must be appropriated by the state legislature. More information is available at: http://www.state.de.us/governor/new_economy_initiative.doc